Why health insurance ≠ health care

“My insurance company is so great! I just love calling them to get my medical bills paid for,” said no patient ever.

Why health insurance doesn’t help you
Have you ever wondered why, out of all the different areas in the service industry, health insurance is both the most expensive and has the worst customer service?

The answer is fairly obvious. Health insurance companies provide you with lousy customer service because you are not their real customer. In fact, you’re a liability. Your medical bills eat into their profits, increase their risk, and take money out of the pocket of their true customer.

So who is the insurance company’s true customer? Currently, and historically, it’s the investor—followed by your employer, although the last several years have seen employers asking their employees to pitch in more and more as insurance premiums escalate. And even if you pay for the premiums entirely on your own, you’re still last in terms of leverage and coverage.

Investors are the real customers
Health insurance isn’t really a service at all; at least, not for you. Investors fund insurance companies with the hope that money collected from premiums will exceed money paid in medical claims. The difference between revenues and expenses is the investor’s net profit margin.

So when an insurance company denies your medical claim, it’s because they’re trying to serve their real customer (the investor) by lowering expenses (claims paid) to keep more revenue (premiums). If they paid your claims quickly and completely when you submitted them, they would have less net profits to give to their investors, their true and only customer.

Employers are in a bind
The health insurance company’s relationship with investors also explains why premiums continue to increase (increased premiums equal greater revenues). Even though employers pay for much of the cost of health insurance premiums, they’re usually unwilling customers with little to no leverage for price negotiation.

So when premium costs rise, employers have no choice but to share the cost with their employees, even while they continue to bear a large financial burden for an insurance product that is shrinking in every way except price.

Health insurance ≠ health care
In sum, insurance companies have 1) a captive payer base among employers with more than 50 employees, 2) no regulatory or monetary incentive to minimize revenue generation by lowering premiums or paying out more claims, and 3) no cap on the amount of profit they can pay to their true customer, the investor.

For example, the following are the 2019 returns-on-investment for three health insurance companies among the top 10 in the S&P 500 for the health care industry—Humana: 33.2%, Aetna: 43.4%, Cigna: 57.4%.

Is it any wonder you dread calling your insurance company to get a claim paid or reimbursed? So what can you do, knowing you are not and never will be the insurance company’s true customer? And how do you get good customer service and medical care without spending a fortune?

Once you realize that the insurance company is not designed to serve your interests, you should look for a model that is. This is the space in which direct primary care is innovating.

Direct primary care = real health care
Direct primary care (DPC) is broad-scope, insurance-free medical care. When you join a DPC, you pay an affordable monthly fee for unlimited, 24/7 access to your doctor by phone, text and email, same-day office and virtual visits, simple surgical procedures, at-cost pricing on blood tests, and discount cash prices on x-rays, MRIs, and CT scans.

With DPC, your doctor partners with you for most of your healthcare needs (at no extra charge), drastically decreasing your chances of hospitalization or specialty care and saving you money. You can also choose cheaper medical insurance plans or health shares that complement DPC services and save more money. And because you’re the true customer, you get the best customer service imaginable.

It’s clear that health insurance is not truly a service industry—not for policy holders, at any rate. This explains why health insurance does not equal health care. At Voyage Direct Primary Care, you’ll get top-shelf customer service and superior health care at lower cost.